Growth is the order of the day at Bocchi Laboratories, a Santa Clarita-based contract manufacturer of personal care products.
The company is adding 45,000 square feet of warehouse and support space at its main facility on Reuther Road, and another 75,000 square feet to its second location in New Albany, Ohio, near Columbus.
“In California, we can add about 25 percent more volume without significant investment,” said Joe Pender, who is marking five years as Bocchi’s CEO. “We can add 300 percent in Ohio.”
The addition to the Ohio facility comes less than two years after the original 125,000 square-foot facility opened in late 2015. Last year was its first full year of production.
Last year, Bocchi reported 300 jobs and a payroll of $10.3 million at the New Albany facility, according to a legislative report from the city’s council. The expansion will add 75 full-time jobs and additional annual payroll of $2 million.
“Putting a facility in Ohio is strategic in terms of where our customers are and in terms of risk mitigation,” Pender said. “If a natural disaster were to hit Southern California, our customers would still expect us to deliver their product.”
The Ohio plant was a greenfield project, the first plant the company has built from the ground up. “Previously, we bought a building and shoehorned our processes into it,” Pender said. “With our building in Ohio, if we could dream it, we could make it happen. It’s somewhat more technology-driven. In the way that Silicon Valley is disruptive, we want our facility to disrupt contract manufacturing.”
In 2014, the Ohio Tax Credit Authority approved a 60 percent, seven-year Job Creation Tax Credit for Bocchi’s New Albany project, with the expectation of creating 300 full-time jobs and $7.5 million in additional annual payroll, according to a statement from the office of Gov. John Kasich.
“There were many factors about the Columbus region that made this expansion the right decision for us,” Pender said in a 2014 statement, “including the region’s prime access to the eastern United States and a very favorable tax and labor climate.”
In Santa Clarita, the company has 360 employees, making it the Santa Clarita Valley’s 24th largest private employer, according to the Santa Clarita Valley Economic Development Corporation. The company’s 86,000-square-foot production plant contains 34 tank configurations, ranging from 500 to 6,000 gallons, for liquid and emulsion products, 15 alcohol manufacturing tanks (1,500-3,000 gallon) for non-aerosol applications including hairspray, body sprays, and antibacterial gels, and 14 holding tanks (4,000-6,000 gallons).
The plan has 20 product filling production lines that include liquid filling lines, alcohol filling lines, a hot pour filling line with cooling tunnel, and tube filling lines.
Pender joined Bocchi in August 2012, having served as CEO of AWARE Products, a contract manufacturer based in Chatsworth.
“I believed Bocchi was well positioned for growth, with great facilities, great equipment and a great customer base,” he said. Pender said that Santa Clarita has a strong employee base, and good safety and security.
“My goals were to elevate our quality, service, reliability, and level of innovation. I looked to to make Bocchi the pre-eminent contract manufacturer on the West Coast.”
One way to do that, Pender said, was to place a greater emphasis on new products and innovation.
“Our customers don’t care where great ideas come from,” he said. “They’re challenging suppliers like us, so we proactively develop product concepts and let our customers know when we see an opportunity.”
Founder Bob Bocchi started the business in 1989, then sold it in 1996 and retired for about ten years. About ten years ago, he bought the company back, and now serves as chairman.
“He’s still active, and was in fact at the plant today,” Pender said. “We’re both operations guys with more than 30 years in this business, so we speak each other’s language.”
Pender expects the building expansions here in Santa Clarita and in Ohio to be done this month, in time for the seasonal surge in product demand. He said he wouldn’t be surprised if the company at some point expands to a third location. “But I would be surprised if it were located in the United States.” Both Europe and Asia are attractive markets.
In the meantime, Pender’s goal is to make optimal use of its two existing plants to fuel growth. “Last year, we produced about 200 million units, and our goal by 2020 is to double that,” he said.